New figures out of the USA on the state of the music industry show music sales for 2009 in the USA had fallen to one album for each person for the year. Note - that is a 2009 figure, not 2010.
Data from the Recording Industry Association of America (RIAA) shows that while digital downloads have had healthy increases by percentage, the revenue generated by the sales of the downloads goes nowhere to replacing the revenue lost from physical sales.
The golden age of the music industry was 1992 – 1999 when the average person purchased around 3.5 albums per year but since 1999 sales have been in steep decline. By 2003, sales had dropped to 2.6 albums per person and have rapidly declined for every year since.
The other major decline is Ringtones. In fact, any sales via mobiles have been in a downwards spiral. Mobile sales hit a peak in 2007. This sector includes Ringtunes, Ringtones, Ringbacks, Music Video, Albums and single sales.
It is not a coincidence that the decline in the Mobile market coincides exactly with the launch of the iPhone allows ringtones to be set via the phones iPod. Apple’s Garage Band software also allows ringtones to be made via an audio source through your computer as well. Again, that became readily available as standard software on any new Mac around the same time.
When inflation is calculated into revenue figures, we see the peak of the industry occurred in 1999. 2009 revenues are down approximately 50% in that time.
Subscription services have declined slightly in the past 4 years. This includes Rhapsody and Zune Pass. However, the new service Music Unlimited from Sony is expected to inject new revenues back into that sector.
Internet & Satellite Radio services have had big increases since 2007 but again the revenue generated from the services goes nowhere to filling the lost revenue gap.
The conclusions from the report show that in real terms the music industry is down 64% from its peak in the late 90s and down 45% from 1973.
26 years ago people spent twice as much as they do today on music. 10 years ago they spent more than 3 times more than today.
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